Bigger and Better Things

While this has been in the works for quite some time, it is now official, all the authors of this blog will now only be publishing new content on the Packaging Section of the Chainalytics Blog.  Follow this link for all our latest packaging and supply chain industry content you have enjoyed here.

Sincere thanks to all of our subscribers and readers here over the years!  We hope you will continue with us on our new and improved platform.  Don't worry, all this content will remain posted here as an archive.

The Most Valuable Ziplock Bag of Air Ever?

This packaging case study involves a lot of hoopla and several diverse inputs: Kobe’s last game, an air-filled ziplock bag and oxygen transmission rates.

There had been much hoopla over the course of NBA great Kobe Bryant’s final year with the Los Angeles Lakers, which only grew exponentially for his last game at the Staples Center in Los Angeles on April 13. The game itself had a storybook ending, with Kobe totaling 60 points.

Given the hype around the event, one could argue that this was a peak moment to cash in on selling Kobe gear and memorabilia.  One of the items found listed for sale on eBay included a “bag of air from Kobe’s final game.” The bids shot up to a high of $17,500 before it and a number of such bags that had turned up were removed by Ebay. Meantime, dozens of media outlets reported on the frenzy, including The Huffington Post.

A ziplock bag of air from Kobe Bryant's last game
showed up on Ebay with bids reaching as high as $17,500

But what about the permeability?

A colleague and I were enjoying a water cooler discussion on the game and this highly valuable bag, when our packaging engineer light bulb flipped on and we thought aloud: “But what about the bag permeability?” “How well could this inexpensive packaging vessel contain this precious investment?”

Read on here at Packaging Digest to see what we found when we put on our packaging engineer hats and delved deeper into this topic.

By: Rob Kaszubowski, Packaging Engineering Manager, Chainalytics

GMO Labeling Law to Stress Packaging Departments

by Rob Kaszubowski: Packaging Engineering Manager, Chainalytics

 In case you had missed it, the latest verdict in the Vermont genetically modified organisms (GMO) labeling saga is in: Food manufacturers have until July 1^st to update their package labeling to include GMO information.

Before and After: Food manufacturers across the country will be required to update their package labeling to communicate if their products use genetically modified organisms

As a recap: Back in 2014, Vermont initiated a law to require all foods containing GMOs to be clearly labeled on all food packaging.

Congress had established a committee to block the labeling change. However, the Senate failed to advance a bill that would ban states from requiring food packaging to disclose the presence of GMOs. Minnesota Senator Amy Klobuchar helped lead efforts to stomp this one down, likely thinking of the holistic impact this change would have on Minnesota-based food producers General Mills, Land O’Lakes and Hormel. This puts the GMO law back in motion and will go into effect in July 2016—in barely more than two months!

Click here to read more at Packaging Digest on how this new labeling requirement will stress packaging engineering departments.

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Rob Kaszubowski is the Engineering Manager at Chainalytics, where he is focused on reducing product damage and implementing packaging cost savings while leading a team of packaging consultants in Design for Distribution initiatives.

Connect with Rob on LinkedIn and on Twitter @KazPack1

Not Enough Product in that Package? Blame It On Slack Fill

By: Rob Kaszubowski, Sr. Packaging Engineer




Food manufacturer, Perfetti Van Melle, was recently handed a hefty $5 Million law suit for a slack fill violation on their Mentos gum (50 count container).  

Essentially, the firm was accused of committing slack fill deception--putting a small product, inside a much larger container to make the product packaging look much bigger and ensure it takes up a bigger spatial/visual footprint on a shelf. 

What Exactly is Slack Fill?

Slack fill is the difference between the actual capacity of a container and the volume of product contained within the enclosed container. While federal laws administered by the FDA regulate slack fill on behalf of consumers, states also weigh in on the issue. 

In California, a slack fill violator is a package that is filled to “substantially less” than its capacity for other than any one or more than the applicable exceptions (California Fair Packaging and Labeling Act, Cal. Bus. & Prof. Code § 12606(c) (1-15)).

Wherever they originate, slack fill laws are aimed at protecting consumers from being duped into buying a packaged product that is misleading. A container that does not allow the consumer to fully view the fill levels is deemed deceptive and misleading unless it contains “functional” slack fill, there are six exceptions which are outlined here. 

A Closer Look at the Mentos Slack Fill in Action

Oftentimes, articles in the business and trade press mention the offending product packaging and the amount the company was penalized or fined, but fail to show exactly “how bad” the slack fill was or exactly what the ratio of product vs. packaging was in these law-breaking products.

We were curious ourselves, so we bought a few containers of this Mentos gum to take a deeper dive.  

Take a look at what we found. Does this packaging deceive you?

Mentos product fill level

Upon opening the container, it looks to be approximately 2/3 full. Further analysis shows this container to be 72% full by weight (28% empty or non-functional slack fill). This is gathered from the ratio of product currently in the container compared to the maximum weight it can hold of the same product. How You Can Measure the Immeasurable

These images above might make the everyday consumer feel deceived upon opening their new purchase and lead them to think “I can’t believe there isn’t more product in this package.” 

The lack of a hard and fast number as to what fill ratio qualifies as “substantially less” than full obviously makes California’s slack fill standard a difficult one to follow. Consumer goods manufacturers must make the judgement call on exactly how much product is enough to meet the minimum requirements—and avoid being penalized. One could argue that the lack of any parameters to define fill levels in a package is similar to driving down the highway with no speed limits posted--only a sign that simply warns “Just Don’t Go Too Fast.”

As a team of packaging engineers, we are focused on optimizing packaging and improving cube efficiencies throughout all supply chain distribution channels—from manufacturing all the way to the retail shelf. We couldn't help ourselves... 

We shortened the Mentos Gum container by 1/2" inch. The original pallet could only hold 3,120 containers. The newly optimized, shortened container allows for a total of 3,744, or 624 more units per pallet - a 20% improvement in pallet utilization! 

With proper packaging, the amount of air space in these individual canisters could be reduced to allow for greater than 20% improvement in pallet counts simply by adding an extra layer of product to the pallet. An incremental change in a package this small can lead to a cascading effect of material savings, logistics savings, warehousing improvements, less out of stocks at retailers, and so on and so forth.

So after reviewing the Mentos packaging dilemma and how much product is actually in the packaging, would you consider 72% full to be bad? What about 28% empty? 

If you feel your products may be a slack fill risk, it’s often a good approach to perform an internal audit and slack fill review. Aside from taking a preventative step to avoid any slack fill penalties, there may be additional cost savings tied to some of those incremental packaging savings. 

The Chainalytics Packaging Optimization practice is a seasoned team of packaging engineers, dedicated to addressing risks and opportunities end-to-end throughout the supply chain.

Questions? Contact us at Packaging@chainalytics.com or give us a call at +1 612.260.7845.

Rob Kaszubowski is a Manager in Chainalytics Packaging Engineering practice. His track record of success ranges from delivering packaging cost savings and damage reduction projects to optimizing packaging throughout clients’ entire supply chains.

Packaging Airline Passengers for Safety

I would like to start off with a shout out to 17-year-old Raymond Wang of Vancouver for winning the top prize at the Intel International Science and Engineering Fair (ISEF), the Gordon E. Moore Award plus $75,000.  Normally, I would just read the accomplishments of the youth science fair with passing interest, but this year, I fervently hope that Wang's winning entry will be adopted and implemented soon. Wang won the top prize by redesigning the airflow of passenger aircraft cabins, specifically to redirect airflow from top to bottom that will help drive airborne contaminants away from fellow passengers.  

According to the June 13, 2015 Science News (SN) article "Teen wins big for pollution control at Intel ISEF"; "His adaption would send the air downward, reducing the number of germs inhaled by passengers by 98 percent, according to Wang's calculations.  Also, the deflector should almost triple the amount of fresh air available to passengers."

HUZZAH!

I hope this highly practical engineering solution will soon improve my traveling experience.  It has also gotten me thinking about airline travel as a packaging issue.  Considering my profession, I'm surprised that I had not thought of the issue of airline passengers through my packaging lens.  I am sure most of us that fly regularly (especially my big and tall friends) are very aware that seat spacing in coach has been compressed over the years which allow planes to carry more seats and thus more passengers.  However, there is much more to consider when packaging passengers in an aircraft.  

The first hurdle, not yet addressed or resolved, is that the seats are not sized for the passengers in neither first class nor coach; every seat space is the same regardless of the size of the passenger.  In my profession, that is like asking Amazon to ship you a refrigerator or a coffee mug in a box sized for a microwave.  This doesn't make sense from a packaging or logistics perspective.  This single size constraint is not good for either the comfort or safety of the passengers who fall outside the fairly narrow space allotted.  To drive greater space efficiency, I have recently seen an idea floated about the potential for stand-up 'seating' on some shorter haul aircraft.  Unless they drastically redesign the shape of the plane from a slight oval to a much exaggerated oval, the airline will be just exchanging inadequate legroom for inadequate headroom.  

Wang's design solution got me thinking about other aspects of packaging our fellow passengers.  The aircraft is a classic modified atmosphere package (MAP); in this case controlling pressure and gas mix.  Modified atmospheres are often employed to increase food safety (inhibit bacterial or fungal growth) and prolong shelf life (control water vapor).  Depending on the product being packaged, the contents may be susceptible to various airborne constituents; oxygen is often purged, nitrogen is often flushed in.  To continue the parallel and relevance of food safety, a food manufacturer would not and could not knowingly allow a contaminated product to be packaged alongside like items for fear of contaminating the entire package, but except in the case of the recent Ebola outbreak, this has been a non-issue for airlines.  

With the advent of Wang's new airflow redirection and the impact on passenger cross contamination safety, I encourage all airlines to retrofit current aircraft to include Wang's air deflector.  In light of some of the recent worldwide virus outbreaks (the cover story in the same issue of SN is the new threat of chikungunya virus), this invention should serve as a minimum standard for passenger safety and serve as a wake-up call to Boeing, Airbus and others to address passenger cross contamination in new and even more effective ways.

 By Eric Carlson, CPP

www.sciencenews.org  || https://www.societyforscience.org || Twitter: @ericpkg

Blog: A Look back at 2014 Packaging Predictions

By: Rob Kaszubowski

The turn of the New Year means a few things: goals, resolutions and planning for the year ahead; and reflections and evaluation on the year that was. Early in 2014 I made a few predictions on packaging trendsfor the year.  Let’s take a look at how those predictions shook out over the course of the year:

1)      Cartonization: While I can’t say the term “cartonization” specifically took off last year, the general theme sure did. We had defined cartonization as the process or tool used to select the best shipper case to transport products. The general idea behind the concept is to have an optimized selection of shipping cases to transport a wide variety or mix of products. FedEx and UPS definitely had the same concept in mind as they looked to optimize the cube utilization within their trailers and delivery trucks when they changed their pricing structure from straight weight to dimensional weight starting January 1, 2015. 

2)      Slack Fill Packaging: As most consumers are painfully aware, slack fill is evident in many of the food and consumer goods products we purchase. However, it’s the non-functional slack fill that will get you in trouble with the attorney general – specifically the empty space in a package that is filled to substantially less than its capacity.  Slack fill started to make more of a splash late in the year when multi-national consumer goods companies Unilever and P&G  and pharmacy chain CVS  were all hit with hefty fines for using oversized packaging that deceived consumers to think they were getting more product than was actually inside the package they purchased.

Big package for small product? This illustration shows the fill line for a popular CVS drug store product.

Courtesy ConsumerWorld.org

3)      Harmonization: Once again, this appears to be a practice that hasn’t quite taken off – at least publically. The theme around harmonization revolves around standardizing and consolidating packaging – where applicable – to increase volumes and leverage buying power. There is often a fine line between standardizing and customizing, as each comes with its own pros and cons. While harmonization wasn’t a headlining theme, it is still a good analysis to perform as companies turn over all the stones searching for packaging cost savings opportunities.

4)      Shelf Space Optimization: This is also a term as consumers you may not hear broadcast from the mountaintops – and that’s just the point! CPG’s are constantly looking for ways to make changes that are visually indifferent to the naked eye, yet allow them to fit one extra box of crackers on the shelf – and also improve their transportation cube efficiencies. Take a look at a few of the changes in packaging sizes that weren’t able to slip past consumers’ attention: http://consumerist.com/tag/grocery-shrink-ray-2

a.       Also a good link: http://www.bostonglobe.com/lifestyle/food-dining/2014/02/11/the-incredible-shrinking-package/Ti6VwQCCcg0whLdr8bHnyJ/story.html

Many packages are shrinking on shelf, is it just the package or sometimes the product too...

5)      Plant-Based Packaging: Last year we lauded companies like Dell and Coca-Cola for leading the charge on sustainable, plant-based packaging. As with any new material or technology there can often be a reluctance for larger companies to take the plunge and put forth the resources required to execute a potentially risky endeavor. However, late in 2014, TetraPak announced the launch of its first package madefrom plant based materials. As the technology behind the materials and manufacturing becomes more sophisticated and increased volumes drive down the price I’m sure we’ll here more stories of other CPG’s launching new plant-based packaging.

So I didn't exactly knock it out of the park in 2014, but then again that’s why they call them predictions. Besides, if I was awesome at predictions I would have made some great stock picks, cashed out and would be sitting on a beach in Cancun! 

Chainalytics Selected for 2014 Supply & Demand Chain Executive Top 100

Supply Chain Improvements with Avaya Yields Savings, Sustainability Worthy of “100 Great Supply Chain Projects”

Atlanta, GA – May 28, 2014 - Chainalytics, a global leader in supply chain consulting, packaging consulting, analytics, and market intelligence, has been selected by Supply & Demand Chain Executive magazine for inclusion into the “100 Great Supply Chain Projects” for 2014.

Chainalytics is recognized in this year's “100 Great Supply Chain Projects” for its supply chain planning and packaging optimization leadership from an engagement with Avaya, a multinational billion-dollar leading global provider of next-generation business collaboration and communications solutions.  

The winning supply chain initiative originated with an initial goal to identify strategies and options for reducing dimensional weight penalties for signal parcel customer shipments. What began as a simple cost reduction project to reduce dimensional weight penalties, quickly evolved into a holistic packaging optimization project focused on sustainability and systemic cost reductions.

“Chainalyitcs’ tools were used to clarify the business case and illustrate - for example - moving from 80 to 150 units per pallet; seeing that causes light bulbs to go on. People get it. The team created enterprise leadership buy-in, momentum, and rapid advancement of the project,” said Lance Casler, senior manager of global transportation with Avaya.

"The Chainalytics team, lead by Eric Carlson and Rich Lindgren, was able to bring strategic leadership to help transform packaging vision at Avaya and gain key stakeholder buy in at multiple levels in the packaging design and distribution & transport packaging testing stages. "

Indicative of the capabilities of the supply chain and packaging experts at Chainalytics, this winning project involved packaging redesign, cube utilization, customized cost modeling, product portfolio subdivision, optimization for transoceanic freight lanes with an emphasis placed on packaging sustainability and quantifiable metrics.

“Avaya required expert resources for packaging engineering, system-wide process improvements and significant reductions in packaging materials and shipping costs. Chainalytics made the most of available resources providing expertise where needed, leveraging Avaya data, quickly identify packaging optimization opportunities and executing action steps,” continued Casler.

The Chainalytics team helped ensure that the total system had a strong fit to meet the needs of the business, working closely with the Avaya team, to design and build a custom savings and justifications “calculator”, integrating freight rates & new container loading densities with considerations to new packaging designs.

Tom Blanck, Practice Leader for the Packaging Optimization team noted: "We had a huge challenge ahead of us, but were able to make a major impact, thanks in part to the collaborative effort of the Avaya's core stakeholder team and their internal packaging resources."

Avaya’s team was then able to take these process improvements and continue to realize tangible savings on their own. Chainalytics’ recommendations and processes remain in place generating lasting project and enterprise value year after year. 

“Avaya’s partnership with Chainalytics created processes improvements with lasting, quantifiable, high-value effects for the enterprise,” stated Casler.

"Initial results achieved through the custom packaging optimization techniques developed by Chainalytics directly resulted in annual savings of 320 tons of corrugated, 16.5 tons of packaging foam, 4000 pallets, 19% fewer ocean containers shipped, and 200 tons of CO2 emissions eliminated."

“Avaya now owns sustainable processes and quality packaging specification development tools for our products. Ocean freight mix has since increased from 20 percent to 80 percent allowing us to realize far greater savings than when project was completed,” concluded Casler.

"Our goal with this year's '100' is to put the spotlight on successful and innovative transformation projects that are delivering bottom-line value to small, medium and large enterprises across the different functions that comprise the supply chain," said Barry Hochfelder, Supply & Demand Chain editor. "The projects featured in the '100' article can serve as a roadmap for supply chain executives looking for new opportunities to drive improvement in their own operations."

The magazine received hundreds of applications and chose the top 100 based on the scope of the project, creative application of technologies and services and the business results achieved.

All 100 winning supply chain projects will be featured in the cover story of the June 2014 issue of Supply & Demand Chain Executive to be released in June, as well as online at www.SDCExec.com.

About Chainalytics

Chainalytics is a recognized global leader in supply chain consulting, analytics, and market intelligence. Through a unique combination of best practice knowledge, exclusive benchmarking research, and advanced decision sciences tools and techniques, Chainalytics empowers fact-based decision making in the areas of Supply Chain Design, S&OP (Sales & Operations Planning), Logistics Operations, Transportation, Service Supply Chain, and Packaging Optimization. Chainalytics targets enterprises with a high degree of complexity created by their unique combination of scale, variability, and geography. With locations in North America, Europe, Australia, and Asia, Chainalytics serves companies globally in a borderless fashion. To learn more, visit www.chainalytics.com

About Avaya

Avaya is a global provider of business collaboration and communications solutions, providing unified communications, contact centers, networking and related services to companies of all sizes around the world. www.avaya.com

No Time Like the Present to Start Right Sizing Your Packaging

Late last week, FedEx announced pricing changes for its FedEx Ground and Freight offerings.

For FedEx Ground, the company said that effective January 1, 2015, it will apply dimensional weight (aka: dim weight) pricing to all shipments moved via FedEx Ground, as opposed to its current method of applying dimensional weight pricing to oversized packages that measure three cubic feet or more. FedEx defines dimensional weight pricing as “a common industry practice that sets the transportation price based on package volume–the amount of space a package occupies in relation to its actual weight.”  FedEx officials said that this change will align the FedEx Ground dimensional weight pricing with FedEx Express by applying it to all packages.

What is dimensional weight, you ask? Dimensional weight is the volume of your package = (L x W x D) / 166. If the dimensional weight is greater than the actual weight of the package, you get charged for the dimensional weight. This formula applies to both UPS & FedEx.

This is going to be a major change for many online retailers, omni-channel shippers and companies that utilize single parcel for moving goods intra-company or business to business.  No need to worry if your company specializes in heavy good like replacement auto parts or gold bricks, but for many companies this could cause a substantial increase in logistics costs.  Based on initial research by WSJ, many companies could see price increase between 6%-30%+ on the majority of their single parcel shipments.

If you think you are protected because UPS is your carrier of choice, most experts agree that UPS will follow suit within a similar timeline.  There would be just too much money on the table for them to pass up.  Not sure if your packages will be subjected to dimensional weight, use our free online dimensional weight calculator below or find additional examples on dim weight in this previous blog post.

Domestic Single Parcel Freight Dimensional Weight Calculator

    

No longer will companies be able to afford ground shipments that look like the picture below.  Before, all this air space would often cost them a few extra dimes in extra corrugated box material and air pillows, but going forward they may be paying extra dollars for that extra air they are shipping in this under-utilized secondary package.

Starting Jan 1, 2015 shipments like this will be costly for online retailers

That being said, this doesn't have to be all doom and gloom, there is a way out or to at least minimize this cost increase.  It all starts with right sizing and/or optimizing your packaging and over packaging strategies, and finding the balance between how many box sizes your fulfillment line should carry, what size they should be, and what's the balance between box size and dimensional weight impact.  Not sure how to do that, feel free to reach out to our Packaging Experts at Chainalytics - Packaging@Chainalytics.com

by Rich Lindgren, CPP
Chainalytics

5 Packaging Predictions for 2014

by Rob Kaszubowski, CPP

Chainalytics

I’m glad I didn’t bet anything on Sunday’s big game since no one could have predicted the lackluster performance of the Denver Broncos. If I were a betting man though, here are five issues that I think will have a big impact on packaging in 2014:

Packaging optimization adds value
to the e-commerce fulfillment process.

1. Cartonization:  According to the U.S. Department of Commerce, online sales have increased by more than 300% since 2004. And you and I both know that the variety of products one can buy online is virtually endless. (Case in point.) Now imagine trying to combine a handful of products (which come in all shapes, sizes, weights, and densities) into a single shipping container that is optimized to minimize material costs, avoid dim weight penalties, and ship without damaging the products. Cartonization is the process or tool used to select the best shipper case to transport products and it is constantly evolving as product mixes and distribution channels change. Retailers that get this right in 2014 will keep their material and shipping costs down and their customers happy.


2. Slack Fill:  For many companies, the issue of slack fill will be a top priority in 2014. Defined as the difference between the actual capacity of a container and the volume of the product it contains, slack fill becomes an issue when it is considered “non-functional.” In recent years, district attorneys in California have been preying on various CPG companies that sell their products in the state under the guise of false advertising. With fines ranging from $2,000 per product on the shelf up to $300,000 per retail SKU, there are serious financial implications for companies in violation of Title 21. Now is the time for companies to analyze their functional and non-functional slack fill to decide if the financial risks outweigh the operational benefits.

   

   A few examples of slack fill in consumer packaging.



3. Harmonization:  A merger or acquisition that combines the operations of two or more businesses requires careful planning and execution. Rightfully so, most companies tackle the big issues first like manufacturing and distribution locations, systems integration, etc. Too often though, packaging harmonization doesn't make the cut. Standardizing the types and amounts of packaging being used creates tremendous buying power and cost savings. Higher volume orders also means greater flexibility to source from multiple vendors and the ability to leverage more regional sourcing. This is this year to address this integration issue if you've recently undergone a merger, or one is on the horizon.
    
4. Shelf Space Optimization:  With minimal storage space in the back room and limited space on the shelf, CPGs find themselves in a constant battle with retailers and grocers. Not only are their profit margins paper thin, but manufacturers also face the ongoing challenge of balancing their demand forecasts with expected shelf life and space on the actual shelf. This is where shelf space optimization comes in. Think if you could optimize and reduce your primary packaging on the shelf to fit two more cartons in the same space. This would in turn reduce the number of stock rotations and costs associated with out of stock and out of date products. CPG companies shouldn't miss the opportunity to collaborate with their customers on shelf space optimization in 2014.
   
   


5. Plant-based Packaging:  Sustainability and environmentally-friendly packaging trends are not new. However, this year may be the banner year for plant-based packaging. Prominent companies like Coca-Cola and Dell have already made a splash with their sugar cane-based PET bottle and bamboo protective packaging, respectfully. Recent tradeshows have also buzzed about mushroom-based packaging and other agricultural-based materials. The price for these alternative materials will only continue to drop as the supporting technology and production processes improve.

What do you think will shake up the packaging world in 2014? Leave a comment below to keep the conversation going.